President Barack Obama has directed the US government not to threaten the hostages’ families with prosecution if they attempt to pay captors’ ransom. Mr Obama has drawn criticism for the long-standing policy of prohibiting concessions to militant groups.

The shift raises questions about whether it makes US citizens more lucrative targets for hostage-takers. The changes come at the conclusion of a review into the US policy, which was ordered after the deaths of several US hostages in the past year. The fact that many European governments regularly pay ransoms to free their citizens has frustrated US families as they have worked to win the release of their loved ones.

“The families of hostages have told us - and they have told me directly - about their frequent frustrations in dealing with their own government,” Mr Obama said, before admitting that government departments are “not always as well coordinated as they need to be”.

He described the problems that the families raised - including the threat of prosecution - as “totally unacceptable”. The changes were ordered in a policy directive handed down by President Obama on Wednesday, known as PPD-29. The White House said that the directive “reaffirms our longstanding commitment to make no concessions to individuals or groups holding US nationals hostage...but makes clear for the first time that ‘no concessions’ does not mean ‘no communication’”.

In a separate statement, the US Department of Justice wrote: “The department does not intend to add to families’ pain in such cases by suggesting that they could face criminal prosecution.”

In the past, hostages’ families have felt that they had few options to win back their loved ones, and some have said that the policy provided government officials with an excuse to avoid answering the families’ questions.

“We had no one accountable for Jim,” said Diane Foley, the mother of James Foley, whose beheading was documented in a brutal video released by the Islamic State group last August. A recent report in the New Yorker magazine details the collaboration between many of the hostages’ families and the efforts that they have undertaken after becoming frustrated with perceived government inaction.

Much of their efforts have been coordinated by staffers at Atlantic Media - a publishing firm based in Washington, DC - including the company’s CEO, David Bradley. Mr Bradley, who was involved in the government’s hostage policy review, issued a statement saying “the US government’s response to the hostage crisis in Syria was uneven, uncoordinated and slow out of the gate”.

He acknowledged that the “pace of government action” increased after the execution of Mr Foley last August, and said he was satisfied with the policy review and resulting changes. The US administration’s review of how it handles hostage situations overseas follows widespread and well-deserved criticism of its performance to date. Although the US Government has made enormous efforts to secure the release of its citizens kidnapped in the Middle East, it failed to communicate these effectively to the next-of-kin.

Relatives were given confusing and sometimes contradictory information from different arms of govt. Most significantly, one family was threatened with prosecution if it paid a ransom to terrorists. That threat now appears to have been lifted for US citizens, although without a change in the law. In Britain, government officials say no one has ever been prosecuted for this but it would be a matter for the police and Crown Prosecution Service to decide.

The adoption of a single ‘fusion centre’ inside the FBI as a point of contact for families brings the US closer into line with Britain, where the FCO’s Counter Terrorism Dept takes the lead on all overseas kidnap cases. To date, the US Justice Department has never followed through on threats of prosecution. However, US officials have long maintained that offering payments makes hostage-taking a more attractive proposition and provides a source of income for militant groups. Mr Obama made the announcement on Wednesday shortly after meeting with the families of several US citizens who have been taken hostage abroad.